RE:RE:RE:RE:RE:RE:RE:RE:Why “Green Copper” Is in Soaring DemandWell it's a relative question. Do you think the cost of harnessing the energy from rushing water will rise to the same extent as the price of oil with shortages coming because of lack of investment, ESG etc? Unless the Congo river is drying up, the hydro isn't becoming less abundantly produced plus it has few inputs - requires some turbine maintenance and what else? Hydro and diesel are completely different inflation scenarios.
And it's always a relative comparison between K&K and other mines. It's the delta between us and the marginal producer which is the profit which I think will be huge based on that chart of demand going up to what 28 million tonnes/year in a few years. No way that we can produce that quantity. Some really high cost mines would have to be producing at the margin except very few new projects even being contemplated so what happens when we can't produce much over 25 million, if that? Substantial deficits coming annually. Escondida's headgrade down to about % .3 and still pumping it out, our grade 15-20X higher. Focus on the delta. Our grade is a massive advantage over other producers and the hydro kicks it up another notch or 2.
But damn inflation is not fun. I'm in a developing country and I'm feeling anxiety thinking about how inflation will hit a country like this with so many people just able to meet daily expenses. People are already complaining about ongoing rising food prices, things could get really difficult for a lot of people for a good long while.
VellyJelly wrote: VellyJelly wrote:
chintzy wrote: "Everything" is going to get us guys, inflation of anything and everything: pork bellies, sugar, coffee, underwear, fertilizers, uranium....rising prices of those commodities and all others could sap all of our profits from $8 copper. You've been warned, continue holding at your peril.
When everything costs more so does hydro. I didnt say ivn wouldnt be economic. It will be because its in the bottom quartile of cu producer cost. Or will be. Everything trades at the margin. cu will trade just above the average industry cost to produce.
VL
To say otherwise is to say theres no relationship between the cost to produce something and the selling price.